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Estée Lauder is exploring a potential merger with Puig, the owner of brands such as Jean Paul Gaultier and Rabanne, in a move that could create a $40 billion fashion and beauty powerhouse.
Estée Lauder is among the world’s leading manufacturers of skincare, makeup, and fragrances, with a portfolio that includes Clinique, Bobbi Brown, and Tom Ford Beauty.
Puig, which went public on the Madrid stock exchange two years ago, owns brands such as Charlotte Tilbury, Carolina Herrera, and Dries van Noten.
Both companies confirmed they are in discussions over a potential business combination, though no details have been disclosed regarding the structure of the deal.
“No final decision has been made and no agreement has been reached,” Puig said. “Until an agreement exists, it cannot be guaranteed that any transaction will take place or what its terms would be.”
“While there might be a crossover in customer base, there are distinct differences between the frequency of their product sales,” said Dan Coatsworth, the head of markets at AJ Bell.
“Estee Lauder is focused on skincare, makeup and haircare, which are the type of products people buy more regularly than the designer clothing offered by Puig. The key area where there is a clear overlap between the two brands is fragrances and perfumes. [However,] one could make a good argument that the two companies’ activities are complementary.”
The confirmation of the potential combination with Estée Lauder has cheered investors. The majority of the voting rights remain controlled by the Puig family, which founded the business 110 years ago.
